An artist’s rendering of the Amazon distribution center at the Cascade Industrial Center in Arlington.

An artist’s rendering of the Amazon distribution center at the Cascade Industrial Center in Arlington.

A tax break used by Arlington, Marysville goes statewide

It’s helped land businesses in Cascade Industrial Center. Soon every city will get a chance to try it.

OLYMPIA — An expiring property tax break which has helped Arlington and Marysville bring new businesses to the Cascade Industrial Center is getting extended.

And soon every city in Washington can consider using it for themselves.

In their final days, state lawmakers agreed to revise, broaden and extend the 2015 law which Arlington and Marysville used to land new manufacturers with good-paying jobs to the industrial center, roughly 4,000 contiguous acres overlapping the two cities’ borders in and around Arlington Municipal Airport.

“We’re just thrilled it got extended,” said Marysville Mayor Jon Nehring. “It gives us predictability. It gives us a tool to recruit with and to bring good paying jobs to north Snohomish County.”

At stake is the ability of cities and counties to exempt property owners from paying the local portion of property taxes due on the value of improvements, such as construction of new buildings and manufacturing facilities. Exemptions could last 10 years and are available only to qualified businesses settling in targeted areas, such as the industrial park.

The current law restricted its use to certain-sized cities in a county with a population between 700,000 and 800,000. Only Arlington, Marysville and Lake Stevens qualified in 2015. But because Snohomish County’s population exceeds 800,000 — and has exceeded it since 2018 — the tax break hasn’t been offered for awhile.

This year, lawmakers passed House Bill 1386 which will extend the availability of the tax break through Dec. 30, 2030, and erased population restrictions to allow its use by any city. Rep. Emily Wicks, D-Everett, sponsored the bill which is expected to be signed into law this month by Gov. Jay Inslee.

To be eligible, a firm must create and maintain at least 25 “family living wage” jobs defined as paying an average of $23 per hour, plus health care benefits. Also, an industrial or manufacturing facility must be at least 10,000 square feet with an improvement value of at least $800,000.

With this bill, the categories of manufacturing and transportation businesses which qualify for an exemption are expanded. And it directs cities to give priority to applicants that pay all workers at the prevailing wage rates; contract with women-, minority- and veteran-owned businesses; use state-registered apprenticeship programs; and hire locally.

And the legislation makes clear a tax break can be canceled if a city determines the company fails to maintain 25 family-wage jobs. If a company becomes ineligible, it will owe the city the amount of property tax it avoided paying.

Wicks’ original bill would have retained the tax break solely for Marysville, Arlington and Lake Stevens. But House Republicans pushed to broaden its availability. Wicks and her fellow Democrats agreed.

She and Nehring said they had no problem with expanding its availability. Their only concern was that such a retooling didn’t in some way prevent its passage — which almost happened.

It cleared the state House on a 97-0 vote. In the Senate, a committee amended the legislation to limit its use in counties with at least 450,000 people. This revised version passed the Senate but the House voted not to accept the change and requested the Senate recede from its position.

The Senate did April 21, four days before adjournment.

“It was interesting. It went through a lot of ebbs and flows,” recalled Wicks, a first-year lawmaker. “To me it is a tool in the toolbox for communities like Arlington, Marysville and Lake Stevens to grow more local jobs. I don’t think it will be a solution for every community.We love the idea that other communities can utilize this to create jobs for people closer to their homes.”

Extension of the tax break comes amid growing interest in the Cascade Industrial Center which, except for the airport, consists of privately owned land.

Amazon is erecting a 2.8 million-square-foot distribution center on 75 acres and forecast for hiring of 1,000 workers. Last year, in an unrelated move, a firm associated with Blue Origin, the Kent-based spacecraft company owned by Amazon founder Jeff Bezos, bought another parcel for a different undertaking.

It is not known if these companies will apply for the tax break.

Reporter Jerry Cornfield: jcornfield@heraldnet.com | @dospueblos

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